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S&P Deposit Receipts (NYSE: SPY) Near Breakout

|Includes: SPDR S&P 500 Trust ETF (SPY)

August 15, 2012 (By Frank Kollar)

Both the S&P 500 Index (SPX) and its tracking ETF the S&P Deposit Receipts (NYSE: SPY) have been slowly regaining ground after a steep correction stopped the November 2011 to April 2012 rally.

SPY closed at 141.84, its rally high on April 2. By June 4, SPY had lost 10% and slowly began to move higher.

Now both SPY and SPX are within a fraction of making new highs again. If they do, it will increase the odds of a continued advance greatly.

Chart Courtesy of

At the same time, a failure to break out would be a huge sign that we could have considerably lower lows ahead.

Certainly SPY 141.84 and SPX 1419.04 are resistance levels that will have a huge predictive value to the just starting rally in U.S. markets.

The ( ETF Timing Strategy has a position in the S&P 500 SPDRs.

Disclosure: I am long SPY.